Recovered irrecoverable debt
A recovered irrecoverable debt is money received from a customer after the receivable was previously written off. The recovery is recorded when received and reverses or offsets the earlier expense in profit or loss. For example, debit cash and credit a recovery in profit or loss, or reinstate the receivable first and then record its settlement consistently.
Worked example
A customer pays 200 after their balance was written off; cash rises and a recovery is recognised.
Common mistake
Crediting a receivable that no longer exists without reinstating it or otherwise recording the recovery correctly.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | F1 | Direct | July 2027–August 2028 |
| ACCA | FA | Direct | September 2026–June 2027 |
| ACCA | K1 | Direct | July 2027–August 2028 |
| CIMA | BA3 | Direct | Official assessment-window verification pending |
| FIA | FFA | Direct | September 2026–June 2027 |
Related terms
Also called: bad debt recovered